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Direct Mail Predictions for 2016: Letter Volumes, Cost & Security

December 15, 2015

Businessman Consulting Glowing Crystal Ball~by Merry Law, President of WorldVu LLC

What’s coming for direct mailers in 2016? Without more ado, here’s what I think the future will hold in the upcoming year. Some predictions will be good for mailers and some will not. In either case, it pays to be prepared.

  1. Costs for mailing and shipping will continue to rise, with increases in the cost of international shipping and mailing remaining substantial greater than domestic increases.
  2. Letter volumes will stop their steep decline and stay at a relatively steady but lower “new normal” volume. This will help the postal operators but will not solve all their financial problems.
  3. Package volumes will not increase as much as the postal operators have predicted. (Competition with the private carriers is strong in that market.) A lack of support services for international shipping by the postal operators will depress further growth in this area for the postal operators.
  4. Addresses in developed countries will remain relatively stable, with minor changes in postal codes or administrative structures (changed postal codes, provinces, or localities) that affect addresses. These changes will affect the deliverability of mail. In some cases, it slows mail delivery; in others, it will make mail undeliverable.
  5. More developing countries will announce new addressing and postal code formats but implementation will be slow. The cost of development, deployment and encouragement for residents’ use of new addressing remains a major hurdle.
  6. New and different ways of addressing, in particular various geolocational codes like GO Code, Posttude and What3Words, will continue to fuel discussions. Use will remain limited to areas without well-developed addresses. They will be used for specific applications unrelated to traditional delivery services.
  7. Many postal operators will have continuing problems with profitability. In the U.S., Congressional agreement on reform and relief for the USPS will remain elusive. In the E.U., with its liberalized postal sector, the national designated postal operators will continue to struggle individually and to join in multi-national consortia.
  8. Terrorism will remain a problem – for the world in general and for mail. It will have a greater affect on mail as security is tightened. As scrutiny increases, delivery times will slow due to the increase in time needed for inspections. It will also affect the security of data, both during its storage and its transfer. We are all at risk of hacking.
  9. More detail will be required from mailers on documentation for packages and parcels. Commercial invoices, bills of lading and other documents will be needed for more items. Postal operators have announced that customs forms for postal items will require the HS number, which is the Harmonized System code describing the enclosed goods, in 2016. (These are already required on commercial shipments – i.e. those by Fed Ex, UPS, and other commercial shippers.)
  10. As package and parcel traffic increase, customs will have a greater effect on international mailers. Customs administration is done by each country and traditionally has not handled a large number of packages sent to individuals, but rather handled large shipments from major companies and transporters. (Each national customs administration has its own rules.) One sure prediction for beyond 2016: The Universal Postal Union quadrennial Congress in Autumn 2016 will pass resolutions that have major effects on mailers around the world. Changes in the way charges between countries for international delivery, revisions of the current weight system, and many other issues will be on the agenda.

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